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Note 5 GOODWILL
The changes in the carrying amount of goodwill for the years ended December 31, 2005 and 2006 are as follows (in
thousands):
United States International Total
Balance as of January 1, 2005 ..................... $1,673,419 $ 877,538 $2,550,957
Acquisitions and other
(*)
......................... 47,333 343,556 390,889
Foreign currency translation adjustments . . . .......... — (46,289) (46,289)
Balance as of December 31, 2005 ................ $1,720,752 $1,174,805 $2,895,557
Acquisitions and other
(*)
......................... (61,873) 19,766 (42,107)
Foreign currency translation adjustments . . . .......... — 115,107 115,107
Balance as of December 31, 2006 ................ $1,658,879 $1,309,678 $2,968,557
(*)
Other includes certain purchase price adjustments that affect existing goodwill. In the year ended December 31, 2005, this also
includes a reduction of $59 million of goodwill related to the divestiture of Yahoo! China. See Note 4 — “Investments in Equity
Interests” for additional information. In the year ended December 31, 2006, the Company recorded an adjustment of approximately
$95 million to goodwill relating to a reduction of deferred income tax assets valuation allowances that were recorded at the time certain
net operating loss carryforwards (“NOLs”) were acquired in previous business combinations. As of December 31, 2006, these NOLs
were deemed to be more likely than not to be realized and accordingly the valuation allowances were reversed against the related
goodwill that was recognized at the time of the acquisitions. See Note 10 — “Income Taxes” for additional information.
Note 6 INTANGIBLE ASSETS,NET
The following table summarizes the Company’s intangible assets, net (in thousands):
Gross Carrying
Amount
Accumulated
Amortization
(*)
Net
December 31, 2005
Customer, affiliate and advertiser related relationships . . $348,111 $(188,669) $159,442
Developed technology and patents ................ 371,610 (119,094) 252,516
Trademark, trade name and domain name ........... 183,536 (60,879) 122,657
Total intangible assets, net .................... $903,257 $(368,642) $534,615
Gross Carrying
Amount
Accumulated
Amortization
(*)
Net
December 31, 2006
Customer, affiliate and advertiser related relationships . . $291,239 $(194,640) $ 96,599
Developed technology and patents ................ 433,340 (222,894) 210,446
Trademark, trade name and domain name ........... 185,674 (86,897) 98,777
Total intangible assets, net .................... $910,253 $(504,431) $405,822
(*)
Foreign currency translation adjustments, reflecting movement in the currencies of the underlying entities, totaled approximately
$1 million as of December 31, 2005 and $18 million as of December 31, 2006.
78
Yahoo! Inc.
Notes to Consolidated Financial Statements — (Continued)